I need some help, y'all.
As a Non-Participating Royalty Interest owner in some oil and gas interests on some dryland farm property in West Texas, it looks like I'm going to start receiving monthly checks. Not life-altering money, but I think my first check is supposed to weigh in at $2500. ... Mom got her's two weeks ago, and I'm still waiting for mail from Tulsa to arrive. Thanks a lot, somebody ...
Anyway, first things first, how to deal with prepayment of taxes to the IRS. I suffer from near-vertigo when reading IRS docs, so hopefully someone can explain this in real simple terms for me. what do I need to do? The last thing I want is to is to run afoul of the revenuers. I just wanna live clean.
Second thing: I'm 55 and the 401K is looking good, but I'd like to use a big chunk of this money to boost the ol' nest egg. Can someone help me with the arithmetic regarding 401k and Roth IRAs. I'm making max 401k contributions, but I understand there is a catchup option I can take advantage of. The only problem is that I have to deduct the catchup contributions up front from my paycheck. Sure, the budget can offset that with the NPRI money rolling in, but I have no idea what to expect from one month to the next. If it suddenly drops to zero, I'll be eating a lot of beans and rice (luckily I can slay a pot of B&R). Should I eschew the catchup contribution and instead open a ROTH IRA on the side instead? Also, on the catchup option, can that even be adjusted mid-year, or do I have to wait until next January.
Lastly, are there any other reasonable investment options to offset taxes (I'm thinking I'm not the type to explore tax-free bonds and whatnot), or do I do what I can with retirement options and take my tax lumps on the rest?
A dozen pardons if this has been covered already in this thread, and thanks.